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However, there will be concerns that they are returning to a pattern of reckless lending.

The new deals announced by the Nationwide offer savings of up to 0.84per cent against the deals it is replacing.

The building society is also cutting the legal fees and registration fees for customers who successfully apply for a mortgage.

It is reducing the interest it charges on 34 of its mortgages for people buying a property from Friday, cutting them by an average of 0.23per cent.

The group's four-year fixed-rate loan for people borrowing 60-70per cent of their home's value will see the biggest reduction, dropping from 5.78per cent to 4.94per cent.

Historically, a loan to value figure of 80per cent was considered a safe and prudent figure.

A buyer would have to come up with a significant deposit, while there was enough of a buffer to head off negative equity if house prices fell.

However, the last boom saw loans from all the major lenders with a loan to value(LTV) of 100per cent.

The failed Northern Rock offered as much as 125per cent to some customers.

The Nationwide deals will allow new customers buying a home to borrow up to 85per cent of the value. Existing borrowers who are moving home will be able to borrow up to 95per cent.

The society believes that loans of up to 95per cent are valid where they have a long-relationship with a customer and they know about their income and spending patterns.

Importantly, such deals allow someone whose home has fallen sharply in value during the bust to move to a new property for work or family reasons.

HSBC has defended its decision to offer loans of up to 90per cent of a property's value on the basis of its belief that the housing bust is over.

Its head of mortgages, Martijn van der Heijden, said: 'Houses prices seem to have bottomed and rates are low – and many of those who put off their purchase last year are starting to look around again.

'HSBC has been out there throughout the recession, staying open for business for our customers.

'While other lenders were in retreat, we became the UK's largest lender in the first half of 2009 on a net lending basis.'

Nationwide has cut its interest rates twice in the past month.

Its mortgage director, Andy McQueen, said: 'The combination of rate cuts, of up to 0.84per cent and fee offers we are announcing should really help first time buyers and seasoned home owners.

'We are reducing the amount that they need to pay upfront and so hope we’ve removed a barrier which may have prevented people from buying a home.

'Existing Nationwide borrowers at the end of their deal will also benefit from fee and rate cuts, as well as continuing to benefit from one flat rate available up to 95per cent loan to value on many products.'